Kmart Corp has been sued by a New Jersey company that accused the retailer of ripping off its full-body banana costume design for its "Totally Ghoul" banana men's Halloween costumes.

Rasta Imposta is seeking unspecified damages from Kmart and its parent, Sears Holdings Corp <SHLD.O>, for unfair competition and copyright infringement, in a complaint filed on Wednesday with the federal court in Camden, New Jersey.

Halloween is big business for retailers and costume providers. U.S. shoppers are expected this year to spend $3.4 billion on costumes alone for the Oct. 31 holiday, according to the National Retail Federation and Prosper Insights & Analytics.

According to the complaint, Kmart decided last week to stop buying Rasta Imposta's "humorous" Halloween costumes, which it had done every year since 2008.

The Runnemede, New Jersey-based plaintiff said Kmart began sales of knockoff banana costumes in August, saying it had found another vendor to provide "that item," and in doing so infringed its 2010 "Banana Design" copyright.

Kmart's costume "has the same shape as the Banana Design, the ends of the banana are placed similarly, the vertical lines running down the middle of the banana are placed similarly, the one-piece costume is worn on the body the same way as the Banana Design, and the cut out holes are similar," the complaint said.

"Rasta Imposta has suffered significant financial harm and irreparable harm to its reputation as a result of Kmart's conduct," it added.

Kmart was selling its Totally Ghoul banana costume on its website on Wednesday for $23.99, a $6 savings, with an additional 10 percent off for entering the code "KBOO."

The case is Silvertop Associates Inc d/b/a Rasta Imposta v Kmart Corp et al, U.S. District Court, District of New Jersey, No. 17-07499.

(Reporting by Jonathan Stempel in New York; Editing by Jonathan Oatis)